Average price of Obama health law plans to drop in 2019

By: Jamie Dupree Updated: October 11, 2018 - 9:17 AM

In a surprise announcement, the Trump Administration reported Thursday that the average price for benchmark health insurance plans under the Obama health law system would drop in 2019 by 1.5 percent, as statistics issued by the feds indicated the controversial health insurance exchanges were stabilizing in price and coverage.

“President Trump's Administration took action to address the skyrocketing price of health insurance, and now we are starting to see the results,” said Seema Verma, the head of the Centers for Medicare and Medicaid Services.

But Verma made clear that President Donald Trump did not want to keep the current Obamacare health system in place.

“Even with this reduction, average rates are still too high. If we are going to truly offer affordable, high quality healthcare, ultimately the law needs to change,” Verma added.

CMS finds that the average premium for 2nd lowest cost silver exchange plans in 2019 will drop 1.5%, the number of counties with only 1 insurer has dropped from 56% in 2018 to 39%, and only 4 states will have just one insurer (compared to 10 in 2018) https://t.co/aScZsbrLEJ

“One big reason insurers are lowering premiums,” said Cynthia Cox of the Kaiser Family Foundation, is that “Individual market insurers are currently so profitable it would be hard for many companies to justify a rate increase.”

“This profitability is also probably attracting new entrants and returning companies,” Cox added.

While the overall average is a decrease of 1.5 percent in premiums for 2019, the state-by-state data varies wildly, with everything from a 26 percent drop in Tennessee to a 20 percent increase in North Dakota.

Larger states like Florida (1.8 percent), Georgia (0.4 percent), North Carolina (-1.4 percent) and Texas (1.4 percent) are all around or above the average – some like Ohio (3 percent) and Arizona (4 percent) are above.

Supporters of the Obama health law said it was more evidence that the system would work – if insurers and the Trump Administration would fully support it.

The Trump administration just announced that average benchmark ACA premiums will decrease by 1.5% next year. The overwhelming factor behind that is that premiums increased so much this year -- 36.9%. Insurers overshot in the face of uncertainty and are returning excess profits.